Senator Sherwin Gatchalian is seeking to protect consumers from the fraudulent schemes of some financial service providers and unscrupulous individuals.

Gatchalian said on Saturday, June 19, stressed the need to come up with a framework to address the emergence of fraudsters who victimize consumers already affected by the COVID-19 pandemic.

“Lubhang nakakabahala ang pagdami ng reklamo mula sa mga konsyumer laban sa mga naglipanang nagpapautang sa online o kaya mga loan sharks na lalo pang naging mapangahas ngayong may pandemya (The increase of consumer complaints about unscrupulous lenders online or loan sharks who have become more brazen during the pandemic)," Gatchalian, vice chairperson of the Senate Committee on Banks, Financial Institutions and Currencies, said in his statement.

He cited a report from the Bangko Sentral ng Pilipinas (BSP), which received 15,015 new complaints from the first to the third quarter of 2020. This was a 63.3-percent increase from those recorded in 2019, which stood at only 9,250.

The lawmaker said the figures did not take into account the unreported cases as some individuals and businesses opted not to do so because of insufficient action on the part of the bank, regulatory agency or law enforcement.

"Alam nilang hindi sila sakop ng financial regulators kaya kailangan ng mas epektibong mekanismo na tutugon sa mga makabagong pamamaraan ng mga mapagsamantala sa kapwa (They knew that financial regulators do not have a jurisdiction over them that's why there should be an effective mechanism to respond to the modern ways of taking advantage of people)," he added.

Gatchalian said he filed Senate Bill No. 2287 or the proposed “Financial Products and Services Consumer Protection Act” which suggests to expand the jurisdiction of government financial regulators to cover all financial products and services offered or marketed by any financial service provider in the country.

He said the Bangko Sentral ng Pilipinas (BSP), Securities and Exchange Commission (SEC), Insurance Commission (IC) and the Cooperative Development Authority (CDA) would be authorized to implement regulations necessary for the protection of financial consumers, such as market conduct surveillance and examination, market monitoring, enforcement, provision of complaints handling mechanism, adjudication and rule-making among others.

Also under the bill, financial service providers will be prohibited from employing abusive collection or debt recovery practices against their financial consumers, Gatchalian said.